CRM is complex, and that may be good…

December 8, 2009 Richard Boardman

The phrase ‘CRM is complex, not because people want it to be’ which appeared in a tweet from Mitch Lieberman last week caught my eye, and, though I suspect I am using the quote outside of its original context, I wanted to write a piece about CRM complexity at least as I experience it – as an independent CRM consultant trying to maximise the pay-back from CRM technology.

Complexity is important because if you believe implementing a system to be a trivial task and it proves to be otherwise, the chances are you won’t be resourced for a successful outcome; rather like fuelling the aircraft for Paris, when the destination is Sydney.

In my experience there is often a yawning gap between perceived and actual complexity which means that many CRM initiatives are inadequately planned and resourced. I will expand on these complexities in a moment, but it’s also worth saying that CRM can be virtually complexity-free.

It’s not too challenging to get a CRM system up and running in a matter of hours. Out of the box software will provide capabilities such as contact and activity management which should allow users to perform their roles more effectively. Usage however is likely to be inconsistent and ad hoc, and though CRM technology in this form may provide some level of return on investment, it’s unlikely to have a materially beneficial impact.

The greatest value that CRM technology provides is to allow you to define, manage and improve your sales, marketing, and service processes in a way that better allows you to attract, increase revenues from, and retain customers. For many organisations these ‘front office’ processes have traditionally been poorly defined, badly supported by technology, and inconsistently executed. Using CRM systems to better control and automate these processes can add substantial operational value.

However using CRM technology in this way is the source of most of the complexities I referred to earlier, as the following challenges need to be met:

• You have to decide how you want the system to add value. Automating what you do already may create benefits, but greater value is generally generated from improving your current processes and using the CRM system to support the new practices. Determining what these new strategies and processes are going to be is a demanding aspect of any CRM project.

• Whether you change your business processes or not, a more process oriented approach to CRM will also tend to be more demanding from an implementation stand point. As you start to embed processes within the technology the more you tend to realise that the ‘out of the box’ capabilities need to be customised to meet your unique needs. Even the most basic of requirements need some level of system adaptation. In addition a process-led approach tends to flush out data migration and integration requirements that a more casual usage doesn’t require.

• Finally, a more process driven approach requires users to use technology in a consistent and systematic way otherwise it’s unlikely to generate any value. Put in an accounting context, the books are unlikely to balance if you are selective as to what transactions you choose to record. Consistent user adoption is significantly more difficult to achieve than most people realise, and has been the ruin of many otherwise successful CRM initiatives.

So, in summary where CRM technology has its greatest impact is where it is consistently used to support an improved set of business processes, but this is considerably more complex to achieve than many buyers of CRM technology allow for. The key is to understand this and act accordingly. It’s better to investment a small amount, recognising that a system will be an inconsistently used personal productivity tool with a limited pay-back, than invest heavily without getting to grips with the associated complexity involved in a more value enhancing system.

Of course it would be great if CRM was easy, but that it isn’t is a great opportunity for companies who wish to achieve sustainable competitive advantage. Markets are dotted with companies who have successfully systemised their ‘front-office’ processes and continue to reap the rewards of doing so because their accomplishment is hard for others to emulate. For these organisations at least complexity is a friend not an enemy.